Can You Have Excess 2017 HSA Contribution Apply to 2018?

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Excess HSA contributions across years

Health Savings Accounts (HSAs) are a great way to save for medical expenses while enjoying tax benefits at the same time. But what happens if you contributed too much to your HSA for a particular year, like 2017? Can you have excess 2017 HSA contributions apply to 2018?

The short answer is no, you cannot apply excess HSA contributions from one year to the following year. However, there are options available to correct this situation:

Correcting excess contributions and penalties

• You can withdraw the excess contributions before the tax filing deadline for the year in which they were contributed.
• You can pay taxes on the excess amount along with an additional 6% excise tax.

If you choose to withdraw the excess contributions, it's crucial to do so before the tax filing deadline to avoid penalties. Additionally, always consult with a tax professional or financial advisor to ensure you handle the situation correctly.

Health Savings Accounts (HSAs) offer an incredible combination of savings and tax advantages that can benefit you for years to come, especially when planning for healthcare expenses. If you find yourself in a situation where you contributed more than the allowed limit to your HSA for 2017, it’s essential to grasp your options regarding those excess contributions in relation to tax implications.